Multnomah County is testing a pilot program to help underwater homeowners locked into high-interest mortgages.

The U.S. Treasury Department on Monday said it has approved a one-county pilot program starting in April that would allow borrowers who owe more than their home is worth to refinance into lower-interest loans. The pilot is based on a proposal Sen. Jeff Merkley, D-Ore., first outlined last summer.

Under the plan, the state would buy the loan and refinance it into a new 30-year loan with a 5 percent interest rate. The borrowers will also have the option to refinance into a 15-year loan, lowering total borrowing costs and paying off the debt more quickly.